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Sun South LLC v. Bayou Vista LLC

Court of Appeals of Mississippi

April 23, 2019

SUN SOUTH LLC APPELLANT
v.
BAYOU VISTA LLC APPELLEE

          DATE OF JUDGMENT: 02/01/2018

          LAFAYETTE COUNTY CIRCUIT COURT HON. JOHN ANDREW GREGORY, TRIAL JUDGE

          ATTORNEY FOR APPELLANT: WALTER ALAN DAVIS

          ATTORNEYS FOR APPELLEE: ARTHUR F. JERNIGAN JR. WILLIAM M. VINES CORY T. WILSON

         EN BANC.

          TINDELL, J.

         ¶1. On November 21, 2017, Sun South LLC filed a Mississippi Rule of Civil Procedure 60(b)(4) motion asking the Lafayette County Circuit Court to set aside the circuit court's July 2012 default judgment against Sun South in favor of Bayou Vista LLC in the amount of $658, 842.13, plus interest and attorneys' fees. The circuit court denied Sun South's motion. On appeal, Sun South argues that the July 2012 default judgment was void for lack of personal jurisdiction over Sun South due to insufficient service of process on the part of Bayou Vista.

         ¶2. Sun South made no formal or informal appearance in the litigation to file an answer or defend the merits of the case until its Rule 60(b)(4) motion, which has no time limitation for void judgments. We therefore find the default judgment is void for insufficient service of process. Accordingly, we reverse and render the circuit court's default judgment.

         FACTS

         ¶3. Sun South is a limited-liability company comprised of two members and managing agents, Michael Halford and Ted Smith. On June 9, 2009, Sun South executed a promissory note in which it agreed to pay $690, 289.25 to Bayou Vista. On April 5, 2012, Bayou Vista filed a complaint with the circuit court to collect the principal amount owed on the promissory note, plus interest and attorney's fees, and named only Sun South as a defendant. The complaint stated that Sun South could be served with process through Smith, its registered agent, at Smith's address in Oxford, Mississippi.

         ¶4. Bayou Vista attempted service of process first by mailing a copy of the summons and complaint to Smith at his address in Oxford. Bayou Vista then hired a process server who delivered a copy of the summons and complaint to Halford's wife, Elizabeth Halford, at their address in Oxford. After Sun South filed no response to the complaint, Bayou Vista filed a motion for summary judgment on May 16, 2012, asserting that the promissory note was valid and remained unpaid. Bayou Vista asked the circuit court to issue a default judgment against Sun South. Bayou Vista attached to the summary-judgment motion an affidavit signed by Smith. In the affidavit, Smith testified that he and Halford had been the sole members of Sun South since its inception and that "to his knowledge," no payment had been made on the 2009 promissory note owed to Bayou Vista. Smith's affidavit did not state that he was testifying on behalf of Sun South, nor did he address the lawsuit or service of process in any way. Smith signed the affidavit, but it not indicate a specific date on which it was executed. On July 20, 2012, the circuit court entered a final judgment of default against Sun South in the amount of $658, 842.13, plus interest and $15, 000 in attorney's fees. The circuit court found that Sun South had not "answered or otherwise appeared" in the action.

         ¶5. Following the default judgment, the circuit court entered a November 30, 2012 order to issue writs of execution against Sun South's property. The circuit clerk issued writs of execution upon four pieces of property that Sun South owned. On October 27, 2015, the circuit court entered an order directing that the sale of the four levied properties be advertised for sale and auction pursuant to Mississippi law. The circuit court then ordered a writ of execution to be issued and served upon Sun South, followed by a notice of public sale about Sun South's levied property. The writs of execution were issued on November 18, 2015, and personally served upon Halford on November 19, 2015, marking the first time that Sun South officially received notice of any default judgment levied against it. On December 1, 2015, Sun South's real property was sold, and the circuit court confirmed the sale by an order entered on December 2, 2015. On December 15, 2015, Sun South's personal property was sold, and the circuit court confirmed the sale by an order entered on December 16, 2015. Neither member of Sun South was present at the sale of the real or personal property, and no one took action to prevent the execution of the writs or the sale of Sun South's property.

         ¶6. On November 17, 2015, Bayou Vista filed a motion for a judgment-debtor examination. The circuit court granted the motion on November 20, 2015, and ordered the examination to take place on December 11, 2015, at 10 a.m. Again, the record reflects no appearance by either member of Sun South at the judgment-debtor examination on December 11, 2015.

         ¶7. On November 21, 2017, Sun South filed a motion for relief from judgment, pursuant to Rule 60(b)(4), and argued that Bayou Vista failed to properly serve Sun South, which voided the judgment for lack of personal jurisdiction. The circuit court heard the motion on January 10, 2018, and ultimately denied Sun South's motion after finding that Smith's ...


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